The rollout of sports betting in Maryland has been much slower than most expected.
And with Gov. Larry Hogan pushing to make mobile betting available by the end of the summer, the panel that oversees the industry took another small step forward.
The Sports Wagering Application Review Commission (SWARC) held a special meeting Wednesday to go over the proposed rules and applications that would apply to Class B retail establishments, as well as to licensees for companies that host mobile wagering. These are businesses not mentioned in the law that was passed in the General Assembly in 2021.
The law aims to give small and minority-owned businesses a chance to compete with some of the nationally known companies, but some have asked whether that might not be so easy.
“Are we overdoing it?” asked Tom Brandt, who chairs SWARC. “Are we making it too hard with all the stuff we’re asking for?”
For instance, any bar or restaurant that looks to have a physical sports betting presence would need to handle all the costs that come with setting up the infrastructure and security. If they don’t own the building where they are located, they would also have to show that hosting sports betting won’t violate their lease.
And they would need to prove that their lease runs for at least the next five years, because that’s how long a license is good for. Moreover, it would cost hundreds of thousands of dollars to get a license, with two different applications to fill out.
Similar provisions in D.C. have led to just one business trying to compete with bigger names already in the game. Brandt and others suggested small businesses might not be equipped to compete.
“It’s a lot for a restaurant or a startup,” Brandt said.
And for the average person, “it’s going to be overwhelming,” said former state delegate Frank Turner, who is also on the panel.
Brandt acknowledged the necessity of controls and security, but admitted, “I don’t have a recommendation.”
Kim Copp, a legal consultant working with the panel, told the members that many of the rules and questions in the application were taken word for word from other states in some cases.
“I suspect most of the folks, if not all of the facility licenses” will probably team up with established gaming companies “to handle a lot of this, the sports wagering component of it,” said Copp. An example of that is what Maryland Live! did with Fan Duel for on-premises sports wagering.
Michael Schaller, another SWARC panel member, said comprehensiveness will “weed out” businesses that will likely struggle to stay in operation.
Brandt noted that the industry isn’t to the point that a sports betting platform is available to be licensed and installed inside small businesses.
“We can’t expose the public to loosey-goosey money movement in the absence of the kind of rules we’re laying out here that we’re depending on the licensee to manage and control themselves,” Brandt said.
Earlier this month, Hogan criticized the SWARC panel for moving too slow, and members are aware that there’s growing impatience around the state.
“What makes Maryland unique is this effort to encourage entrepreneurs to get into this industry the way our state is trying to encourage,” Brandt said. And that, he added, has led to an extra layer of bureaucracy.
“I’m sharing this information to help us all adjust expectations as we proceed with our responsibilities,” Brandt said, adding that he hopes applications can be accepted by late summer.
That’s the target Hogan has pushed for, in anticipation of getting more sports betting options up and running by the time football season begins.
